Chennai floods, workers' agitation hit city's textile biz

SURAT:
The country's largest man-made-fabric (MMF) textile industry in the
city is suddenly facing a grim situation. If production of polyester
fabric has suffered heavy loss due to the ongoing agitation by textile
workers, incessant rain in Tamil Nadu, especially in Chennai, have only
made the situation worse for the city's textile traders.

An
estimated Rs 300 crore worth of orders have been cancelled by buyers in
Chennai in the past fortnight because of the rains. Out of Rs 110 crore
worth of daily supply of saris, home textiles and dress materials from
Surat, textile products to the tune of Rs 30 crore are despatched to
markets in southern India. Supply to Chennai has come down to 80 per
cent in the last few days because of the rains.

The year 2015
has not started on a good note for Surat's textile industry. The
industry, which is grappling with weak demand for polyester fabric and
instances of defaults to the tune of over Rs 150 crore, sees its hopes
crashing further because of the floods in Chennai and the ongoing
workers' agitation.

The powerloom sector has a production
capacity of 3 crore metres of fabrics per day, weaved on over 6 lakh
powerloom machines. Over 3.5 lakh powerloom machines have stopped
working in over 12,000 units in Jolva, Palsana and Laskana in the last
two weeks because of the agitation by workers who are demanding a wage
hike.

"South India is a major market for textiles from Surat.
Chennai, Rajahmundry, Hyderabad, Bangalore, Thrissur, Kozhikode, Kochi,
Vijaywada and Cuddalore are important textile centres in south India.
Rains have hit these centres hard which have adversely affected the
textile industry here," Southern Gujarat Chamber of Commerce and
Industry's (SGtextile committee chairman Devkishan Manghani said.

"Textiles worth Rs 30 crore are sent daily to south India from Surat.
Supply to south India has come to a halt because of the rains and it may
take at least three months for normalcy to return there. The losses to
the textile units may run into hundreds of crores of rupees," Manghani
added.

"It is that time of the year when demand for saris and
dress materials is nil in north India, so we have to depend on markets
in south India for business. Next three months would be tough for
Surat's textile industry," said Jay Lal of Federation of Surat Textile
Traders Association (FOSTTA).

"Most traders supply textiles to
markets in south India on credit. Payments have got stuck because of the
rains, disturbing the turnover chain. If the payments do not start
coming soon, there will be a monetary crisis staring the textile sector
in the city," Jay Lal added.

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